UK Steel Crisis: Government Contracts To Consider Job Creation

The United Kingdom will ease rules to give local steel producers a better chance at winning government contracts as part of the plan to prop up its steel industry, after India's Tata Steel put its British plants up for sale, putting thousands of U.K. jobs at risk.

Government contracts will now no longer be based only on price and quality, but will also consider if they will help create jobs and boost the economy of the region, local media reported Saturday. As European Union rules ban direct handouts, the British government plans to create an approved supplier list specifically for steel companies wanting to bid for public sector projects as part of its support measures.

The U.K. is also looking for a buyer for Tata Steel's businesses — employing 15,000 people in the country — which were hit by high costs and Chinese competition, Reuters reported. However, Prime Minister David Cameron ruled out a state takeover earlier this week.

U.K. Business Secretary Sajid Javid said Sunday: "By changing the procurement rules on these major infrastructure projects we are backing the future of U.K. steel — opening up significant opportunities for U.K. suppliers and allowing them to compete more effectively with international companies," BBC reported.

According to new guidelines for the public sector, procurements involving the supply of steel will need to consider "responsible sourcing, the training suppliers give to their workforce, carbon footprint, protecting the health and safety of staff and the social integration of disadvantaged workers."

Companies will also be required to advertize for their requirements and contracts so that local firms can compete for the business, according to BBC.

The introduction of the measures may take six to nine months, a spokeswoman for the Department of Business, Innovation and Skills told Reuters.